Product Lifecycle Management

Enterprise Resource Planning

Craig L. Miller, Ph.D.

Department of Computer Graphics Technology
School of Technology
 Agenda

• ERP 123
• Case Study: Corporate Express
• PLM vs. ERP, SCM, and CRM

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 What is ERP?

• Enterprise Resource Planning (ERP)

– Planning?
– Resource?
– Enterprise!!

• ERP’s ambition
– Integrate all departments and functions across a company onto a
single computer system that can serve all those different
departments' particular needs.

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 ERP = ??

• ERP vanquishes the old standalone computer systems in finance,

HR, manufacturing and the warehouse, and replaces them with a
single unified software program divided into software modules that
roughly approximate the old standalone systems
• The best way to demonstrate ERP’s value is the improvement on
taking a customers order and processing it into an invoice, a.k.a. the
order fulfillment process
• ERP is the back office while CRM handles the front selling process

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 Customer’s Order

• The old way

– Delay of traveling
– Paper missing or key-in errors
– Lack of visibility due to stand-alone systems
• The new way
– A software roadmap for automating different steps for order fulfilling
– Ex. For a customer service representative
• Credit rating and order history from finance
• Company’s inventory levels from warehouse
• Shipping dock's trucking schedule from logistics

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 ERP Context

• Order management
• Procurement
• Financials
• Warehouse/inventory
• Marketing
• Human resource
• Production planning
• Project management

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 Corporate Express - Example

• Business category
• Company information
– April 11, 2003: 12,400 @ more than 200 locations and 48
distribution centers
• Number of products
– More than 60,000 for 400,000 customers
– Around 50,000 online for 40,000 customers
• Target customer
• Sales of 2001
– 5 billion in sales

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Corporate Express’s Operations
• Business model
– B2B
– Manufacturer <-> Corporate Express <-> Customer
– Channel of order
• Business challenges
– Growing pain
• Acquired 500+ companies in a 15-year period
• Various order fulfillment applications and databases on 43
servers
– Scalability
• 4.4 millions on 01/08/02; 7 millions on (01/07/03)
• Raised from 30% to almost 50% from online sales
• 1.5 billion for e-Commerce for 2003

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 Corporate Express’s Implementation

• Components
– E-Way: Online procurement system
– InVision: In-house ERP (order fulfillment)
– PeopleSoft Financials and HR management
• Infrastructure
– Sun ONE + J2EE
– Oracle 8i
– Why Sun Micro
• IT expertise and hand-in-hand consulting
• Hardware expandability: 10 -> 56 CPUs

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 Benefits

• $10,000 saved/daily (= 3.65 millions annually) in operational

expense
• 100% ROI in 9 months
• 10% increase of computing environment ownership
• 157% increase in sales through E-Way
• 99.99% availability of servers
• 100% faster processing (250 transactions per second) for
employees’ productivity enhancement

(From Sun Micro, 2002)

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 ERP Practitioners

• ERP market value

– 28.9 billion in 2003
– B2B 1.3 trillion by 2003 (Forrester Research)
• ERP Vendor
– SAP, Oracle, Baan, PeopleSoft
– MAPICS, CA, Microsoft
• ERP Customers
– Major manufacturers
– Retail and mail order
– Does everyone need ERP?

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 When PLM Meets the Rest
• Corporate Express Promotional Marketing
– THE promotional merchandise catalog
– Items for business needs or specific promotional
requirements
– Item number: 750,000+ with 15-20% cheaper
• Mass customization
– For customer: Order request (CRM)
– For CEPM: Inventory and cost (ERP + SCM)
– For manufacturer: Engineering change (PLM)
• Key issues: Numbers of transactions

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 The Complete Supply Chain

vendor 1 InVision customer

vendor 2
customer
vendor 3
Corporate E-Way

Express
MAPICS customer
vendor 4

vendor 5
customer

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 Conclusion

• What is ERP
• How does it work
• PLM vs. ERP, SCM, and CRM

• Reference
– SAP
– Oracle
– Sun
– The ERP Fan Club

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 Acknowledgments

The author wishes to acknowledge the support from the

Society for Manufacturing Engineers - Education
Foundation, SME-EF Grant #5004 for “Curriculum Modules
in Product Lifecycle Management.”

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